The acquisition of Marshall Editions helped lift sales 1.5% at the Quarto Group for 2002, to £74.7 million ($119 million). Pretax profit in the year rose to £5.1 million from £3.3 million. In the company's co-editions segment, revenue increased 0.7%, to £41.9 million, but operating profit fell to £4.5 million from £5 million. Sales in the publishing segment rose 2.8%, to £32.9 million, and the unit had an operating profit of £2.9 million, a gain of 26%.
In addition to the purchase of Marshall Editions, a number of Quarto's core businesses had gains. However, its Rockport/Rotovision unit "did not do well," and the publisher's new books-plus imprint, Q+, was "very disappointing," the company reported. The increase in profits was helped by the elimination of losses from Quarto's art book publishing operation.
Company chairman Laurence Orbach said he was pleased with results given the difficult retail environment, adding that he remains confident in the future of the book. That confidence led Quarto to launch two new co-edition imprints in 2002 and a third new one, Iqon, earlier this month. Quarto also finished the three-year installation of a new software system in 2002.
The new system is part of a rebuilt infrastructure that will permit Quarto to aggressively pursue acquisitions in 2003 as part of the mandate from the company board to "grow substantially" over the next several years. To help handle the expansion, Orbach said Quarto hopes to hire several senior people by this year's second quarter. Orbach noted that the company has the necessary funding to complete "a serious acquisition." Acquisitions will be the key to growth this year: Orbach said that despite being "quietly confident" that Quarto will be able to "navigate the choppy [economic and political] waters," organic growth in 2003 "may be less robust" than originally forecast.